Listen above or on the go via Apple Podcasts or Spotify.
Avi Gilburt talks about TLT 2024 targets and what’s taking shape in treasury market (0:25). Why he’s bullish on the metals; will silver outperform gold? (3:45) This is an abridged version of a recent conversation.
Subscribe to Avi’s The Market Pinball Wizard
Transcript
Rena Sherbill: Avi Gilburt, welcome back to Investing Experts. Always great to talk to you on Seeking Alpha.
A lot of people are focused on the bond market right now and T-bills and looking to that area of the market. What are your thoughts there? And also vis-à-vis maybe allocating that as part of the portfolio.
Avi Gilburt: Well, we track the (TLT), for example, is a good ETF for everybody to track on their own just as a general idea of what the treasury market is doing. And back in October of this year, so a couple months ago, I was giving our members a region of 81.75 to 82.50 as a bottoming zone for the TLT which could begin a very large rally into 2024.
I think we bottomed at about 81, I think the number here is about 81.92 or so, I could be wrong, but it bottomed exactly right in the zone we were looking for that bottom. Assuming again, assuming the next pullback is corrective, I’m looking for the TLT to next rally up into the 105 to 110 region, potentially followed by another corrective pull back.
And if we can get through that 109 region, then we’re easily going to get to 120. And ideally, that really should be my minimum target for 2024, the 120 region in the TLT. Depending on how the rest of the year takes shape, it could even get up as high as the 131 to 142 region.
But the bigger issue with the TLT is, the next rally that takes shape, larger degree rally that takes shape in the TLT, is not one that you want to take lightly.
You want to use it as an opportunity to get out of the bond market to a great extent because whatever that rally and however that rally takes shape, it’s likely – the way it’s setting up on the bigger degree charts, it’s likely going to set up a bond market crash which potentially could be a lot worse than the one we’ve seen since 2020.
I wouldn’t consider what we’ve seen since 2020 necessarily a bond market crash, I would say yes, it was a very, very large decline. But what could be shaping up could be a bond market crash as we look towards the second half of this decade.
Market structure is what gives me advance warning where a market turn could take shape. And then the nature of the turn, how the turn develops tells me – does it have legs or not in the opposite direction.
So depending on what happens at 120, if the market begins declining in an as I put it, an impulsive five-wave structure, then that’s the initial signal that a bond market crash is starting to develop. If the pullback from 120 is clearly corrective, then it likely means we’re going up to 130 to about 142, 131 to 142. And from there, the bond market crash will probably begin.
RS: Any other sectors that you’re focused on, or bullish on, or particularly bearish on?
AG: I really like the metals. Metals are really starting to set up in a way, and I’ve been writing about this for few months. Now the metals are setting up in a way that could present us with a major move into 2024, maybe even into 2025 as it continues.
Gold and silver with silver potentially outperforming gold and (GDX) which is a mining ETF being in between the two.
RS: We had Don Durrett on, he runs a gold and silver mining and also just gold and silver Investing Group. And he was talking about how investors should be stacking silver, how he’s just extremely bullish on that metal in particular over long period of time.
Can you talk a little bit, articulate the reasons why it’s looking so bullish there?
AG: For me, it’s all about structure. And the structure to me is what tells me where we are in market sentiment and market sentiment, especially in the metals is what drives it. I remember my first article on Seeking Alpha was actually my first technical article about a market, about a specific price market was actually in the gold market back in 2011. And everybody was so bullish. It was going parabolic some days.
You were seeing $50 plus rallies per day. And I remember everybody was arguing about one thing. How far past 2000 are we going to go in 2011? And from where I was sitting, it looked like we were hitting a top. And I published my first article from a sentiment standpoint, which is what we track from an Elliott Wave analysis perspective. And sentiment-wise, it was telling me that 1915 is probably where we’re going to see a top. As we know now, 1921 was the top.
Now from a sentiment standpoint again, even before we top, people were asking, where do I see the bottom? Where do I see the market coming down to? And I said, I think we’ll probably drop back down to around 1000. We bottomed at about 1045 or 1050 from what I remember in gold.
So we look at everything from a market sentiment standpoint and Elliott Wave analysis tells us from a mathematical perspective where we see how things are going to move. So when I look at the gold market, I’ll use the (GLD) because, that’s probably what more people track than anything else. As long as we’re staying over the 175 to 180 region on GLD, to me this is an ETF that’s probably going north of 250 over the next year or two.
Read the full article here
